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First phase of operations completed as part of KfW water project in Azerbaijan

The first stage of work completed as part of the reconstruction of water supply and sewerage system in the city of Ganja. It was carried out as part of the "Second program of open communal infrastructure" and funded by the Azerbaijani government, the German bank KfW and the Swiss State Secretariat for Economic Affairs Seco, Azersu (national water operator of Azerbaijan) said Aug. 28.

The work was carried out to restore the water sources and to construct the main water lines during the first phase of the project. Taking into account the relief, perspective development of Ganja and the needs of the population, three water sources, namely, the drainage systems of Goygol and Gyzylgaya, as well as Shemkirchay reservoir were chosen to provide the city with water, according to the statement.

The construction and installation work on the Goygol water source completed as part of the first stage. At this stage, the drainage system with a capacity of 200 liters of water per second was restored. A reservoir with a capacity of 4,000 cubic meters and the main water pipe with a length of 24.5 kilometers were built.

Thanks to this source, 20 percent of the population of Ganja (63,000 people) will be provided with uninterrupted high-quality drinking water around the clock.

The water supply from these sources to Ganja will begin in the coming days.

Other source Gyzylgaya providing the city with water was also restored. A reservoir with a capacity of 2,000 cubic meters and water lines with a length of 9.5 kilometers were built. Moreover, the construction of new reservoirs with a total volume of 10,000 cubic meters is under completion.

Around 60 percent of the needs of Ganja in drinking water will be ensured via the Shemkirchay reservoir. The main water pipe with a length of 27.5 kilometers is being constructed. The water from the reservoir will be supplied to a purification unit on the territory of Gyzylgaya, according to the statement.

Moreover, smart card water meters were installed in multi-storey residential buildings of Ganja. Around 7,000 meters were installed in 119 buildings, according to the statement.

The project for the reconstruction of water supply and sewerage system in Ganja till 2035 is designed to provide 450,000 residents with drinking water.

KfW allocated two loans to a total amount of 137 million euros within the project. In accordance with the agreement signed in Bern in October 2006, the first KfW loan to the tune of 37 million euro was granted for a period of 40 years with a grace period of 10 years and interest rate of 0.75 per cent per annum. The second 100 million euros worth loan was allocated under the agreement signed in December 2012 for 12 years with a grace period of three years and a rate of 1.96 per cent per annum, whereas the bank previously offered 2.35 per cent.

The German bank signed agreements for a total of 102 million euros (100 million euros in loans and two million euros in grants) on December 20, 2012 to finance the second and third phases of the project. Of these funds, 43 million euros were provided for the restoration of water supply and sewage systems in Ganja and Sheki and 57 million euros for the construction of wastewater treatment plants in these cities. Grant funds are being provided to manage Water Channel departments for two years.

An additional $150 million is required to complete the project. Total project cost including loans from the German bank, interest of the Azerbaijani government and a grant from the Swiss State Secretariat for Economic Affairs Seco worth 10 million euros, is estimated at $366 million.